Indian Oil Corp, the nation’s largest refiner and fossil fuel retailer, spent Rs 5,852 crore in the April-June quarter, the maximum among state oil firms.

NEW DELHI: State oil firms have spent about Rs 18,000 crore in the first quarter of the current fiscal, nearly a fifth of their planned annual capex, on exploration and production and expanding their refining, transport and marketing infrastructure.

Indian Oil Corp, the nation’s largest refiner and fossil fuel retailer, spent Rs 5,852 crore in the April-June quarter, the maximum among state oil firms. This is about a quarter of the company’s planned annual capex. Bharat petroleum finished about 28% of its annual capital outlay of Rs 7,400 crore in three months.

Oil and Natural Gas Corp, the country’s largest oil and gas producer, invested Rs 5,821 crore in its upstream activities, about 18% of its 2018-19 spending target. Overseas arm ONGC Videsh used up Rs 1,073 crore during the quarter against an annual target of Rs 5,886 crore.

Hindustan Petroleum spent less than 14% of its annual target of Rs 8,425 crore. GAIL, which is currently building the country’s largest natural gas pipeline, spent about 18% of its annual capex target while Oil India exhausted 16% of its annual capital outlay.
Indian oil firms are investing heavily in exploration and production, and expanding refining, marketing and distribution facilities to cater to the rapidly rising oil consumption in the country.

Consumption of petroleum products grew 5.1% in the April-June period, with petrol, diesel and cooking gas driving sales. The country, a net exporter of refined products, has been speedily adding refining capacity to cater to the expanding domestic demand as well as to retain its share in the export market. India’s refining capacity is planned to rise to 439 million tonnes per annum by 2030 from the current 248 million tonnes with state and private firms planning massive expansion.

Similarly, the need to cater to the fast expanding domestic consumer base has prompted oil companies to plan new pipelines, storage, and dispensing facilities. An increasing government focus on turning India into a natural gas-based economy has also pushed up the local consumption of the fuel. To facilitate greater import of natural gas, several terminals for the import of liquefied natural gas are being set up and pipelines being laid.

The process of awarding 86 city gas distribution licenses is also underway, which is expected to almost double the piped gas access to urban homes.

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